Thursday, July 30, 2009

Declining Integrity Hurts Small Business

Alexandra, my wife's friend from Woodstock, just mentioned that many of the small businesses in the Hudson Valley/Catskills region are dishonest. In fact, it took me ten years to rehab my house in West Shokan in the Town of Olive, and almost as long to find honest craftsmen--an honest, competent plumber who knows how to design a heating system; a responsible electrician; a sober landscaper who does the work efficiently and intelligently; a mason who shows up and does a competent job quickly; a carpenter who finishes the job; a roofer who does not allow tar to spill over the side of the roof and knows that the problems are in the corners and details; and a snow plow guy who shows up punctually when it snows. Along the way I met a builder who took almost two years to re-work my bathroom (including an extension) and disappeared when I objected to the cost's becoming four times his original estimate; a landscaper who went way over budget and called me dishonest for objecting; another landscaper who left a new septic tank sitting on my front yard for almost a year; and a mason who never finished the job.

Without going into details excessively, I learned that requesting references chases away the worst perpetrators (several of them simply disappeared when I requested references) and to get all estimates in writing.

Although construction may be the worst venue, dishonesty seems to be common now. I have seen this in northern New York (Potsdam) as well, and I do not believe it to be a regional pattern. Rather, I suspect that ethics are on the decline.

That is unfortunate. Small business can offer a lot that big business cannot: good relationships, superior service, and understanding local needs. But the lure of the quick buck blinds too many of us from the traditional path of building a reputation through fair dealing. Unfortunately, big business has contributed to this moral climate. I do not believe that a business can become big by being dishonest. But once big, businesses too often utilize their market power in questionable ways. This should open up competitive avenues for small business. But instead of seeing the opportunity in quality, too many entrepreneurs see the opportunity in emulating corporate managers in seeking the quick buck.

The Catskills never seems to develop (which incidentally is fine with me now that my house is built and I have a good list of contractors). I think one reason is the failed moral attitude whereby money and short term gain are put before integrity. Show me an honest culture and I will show you a successful one.

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Mitchell Langbert

About Me

I have researched and written about employee benefit issues and in my previous life was a corporate benefits administrator. I am currently associate professor of business at Brooklyn College. I hold a Ph.D. from the Columbia University Graduate School of Business, an MBA from UCLA and an AB from Sarah Lawrence College. I am working on a project involving public policy. I blog on academic and political topics.